Jul 02, 2018
Amazon.com has introduced a program to help entrepreneurs with little to no logistics experience start their own businesses delivering packages sold on the e-tail giant’s site.
Those interested in the program, called Delivery Service Partner, can count on the “built-in demand” of delivery volume from Amazon and access to its sophisticated delivery technology and hands-on training. To help keep startup costs as low as $10,000, Amazon is offering a variety of discounts including breaks on Amazon-branded vehicles customized for delivery, branded uniforms, fuel and comprehensive insurance coverage. Leased vehicles can only be used to deliver Amazon packages.
Amazon claims successful owners can earn as much as $300,000 in annual profit operating a fleet of up to 40 delivery vehicles. Over time, Amazon hopes to “empower hundreds of new, small business owners to hire tens of thousands of delivery drivers across the U.S,” according to a statement.
The start-ups will complement traditional carriers and other small-and-medium-sized delivery companies.
“We have great partners in our traditional carriers and it’s exciting to continue to see the logistics industry grow,” said Dave Clark, Amazon’s SVP of worldwide operations. “Customer demand is higher than ever and we have a need to build more capacity.”
The new program is in line with the way Amazon has helped more than 140,000 small-and-medium-sized businesses with more than $100,000 in sales annually reach third-party buyers through its Marketplace. Kindle Direct Publishing and Amazon Web Services (AWS) have likewise supported small business ventures for authors and developers.
The service has been in test mode. A microsite, logistics.amazon.com, features stories of entrepreneurs, many former Amazon Flex drivers, successfully launching delivery businesses.
Some retail observers see the launch of Prime Air, Amazon Flex and other delivery initiatives as signals that Amazon intends to eventually replace UPS, FedEx and other carriers with broad in-house delivery capabilities to keep costs down.
A fleet of Amazon trucks could also help customer service. Upgraded features introduced earlier this year allow customers to track packages coming from Amazon’s logistics on a map, contact the driver or change where a package is left. Some Amazon couriers are sending images to customers to show where they left packages.
DISCUSSION QUESTIONS: Do you see Delivery Service Partner as a major or minor component in Amazon’s delivery growth strategy? Will the program hold high appeal for entrepreneurs?
“Deliveries are core to Amazon’s success and, as it grows, it must secure resources to maintain that signature element of its brand. “
